Rental of retail units up both locally and nationally

After being largely vacant for four years, the Ormond Beach Marketplace is finally filled with tenants.

By Fatima Husseinfatima.hussein@news-jrnl.com

After being largely vacant for four years, the Ormond Beach Marketplace is finally filled with tenants. Shyam Verma, co-owner of the shopping center, recalled that during the recession's beginnings in late 2007, there were up to eight retail space vacancies at one time in the 30,000-square-foot shopping center.“So many people left at one time,” Verma said of the center at the intersection of Nova Road and Granada Boulevard, which has recently become host to an independent coffee shop, a bodybuilder's supplement store and a frozen yogurt shop.Verma said the plaza is slowly returning back to its once-filled capacity before the recession. “We had to support the center without those tenants when times were not so good. So, I hope with it being filled that it stays that way,” he said.The rate of retail space rentals is modesty increasing statewide, by 0.2 percent, according to the Los Angeles-based CBRE Group Inc.'s most recent quarterly study.Though in the Volusia-Flagler county area, business owners are renting more retail properties than they did last year, according to local commercial real estate brokers. “More particularly in Ormond Beach and Port Orange,” said Claude Gardner, a broker and managing director of Prudential Commercial Real Estate FL in Daytona Beach. “Those are hot spots right now, where demand is going up and inventory is where it needs to be. This growth is definitely moving in the right direction,” Gardner said. Flagler County, however, is still a couple of years away from seeing Volusia County's growth, said Cornelia Manfre, broker associate at Palm Coast-based RDC Real Estate Services,LLC and former agent with Palm Coast Prudential Commercial Real Estate. “We're seeing more inquiries from retail developers, though” said Manfre, who remembers when during the recession, retail developers had no interest in the heavily blighted areas of Flagler County. She said the upside is that retail rents in Flagler County are lower than the state average of $17.95 per square foot; she has seen some parcels on Palm Coast Parkway with rents as low as $12 and $13 per square foot.In Florida, commercial retail space rentals are growing at a snail's pace, with commercial property owners holding onto a 7.9 percent vacancy rate, a decrease from the 8.1 percent from this time last year, according to the CBRE Group's study. The growth is due in large part to increased tourism, a lower unemployment rate and increased consumer confidence, which is at its highest since before the recession, according to the same study. As a result, “rent is slowly inching up because of the increase in demand for quality retail spaces,” said Tom Corso, vice president of retail leasing at Charles Wayne Properties in Daytona Beach.He added that for consumers, this means more competition in the marketplace, and for business owners, it can indicate a rush to get the best rental rates while demand for retail spaces continues to rise. “Florida is seeing demand outpace supply across the state for fundamentally strong retail properties,” according to the CBRE's quarterly study. Gardner said while commercial rental growth is still slow, from a real estate perspective, “It means people are willing to sign a 36-month lease for a space, and that's a sign of stability in the market.”